Zimbabwe's annual rate of inflation leapt to a record high last month as the country's economic situation continued to deteriorate.

All the conduct of the government at the moment is inflationary

Economic consultant John Robertson

The annual rate of inflation rose to 135.1% in August from 123.5% in July, according to the latest figures from Zimbabwe's Central Statistical Office.

The surge in inflation reflects high levels of debt-fuelled government spending as economic output falters due to a combination of drought and political unrest.

The relentless increase in consumer prices is expected to inflict further economic hardship on a population already burdened with an unemployment rate estimated at 60%.

Price checks

"All the conduct of the government at the moment is inflationary. They are borrowing enormous quantities of money at very low interest rates which they themselves set," said economic consultant John Robertson.

Government price controls on basic commodities aimed at reining in inflation have created a thriving black market where bags of grain change hands for up to three times the official price.

Zimbabwe's economic crisis has been exacerbated by the government's policy of seizing white-owned farms, a programme which has disrupted agricultural output.

About 6.5 million Zimbabweans - half the country's population - are thought likely to need emergency food aid this year.